European Agencies: Clients give counsel

Three European media directors give their views on the state of the media networks and offer their advice to the new breed of European media and advertising agency heads. BUENA VISTA INTERNATIONAL - Giles Hadman, European media director, Buena Vista International

For a network to work effectively, it has to work together, as a unit. The new network heads will come to realise that they have to keep every plate spinning, even the smallest market. If the smallest drops, you are in trouble. And once the plate is smashed, the rest drop with them.

I can't see why, if there's a problem in any particular market, it can't be solved from elsewhere in the network. That's the whole idea for me; using conforming approaches to business to resolve client issues despite their unique local difficulties.

On the positive front, there has been a natural change in the advertising world. We are seeing a genuine switch from an agency network brand that offers "media" to one that is more holistic in its approach to communications.

But remember that Disney is a media company, too. We know a lot about communications and it can be frustrating for us as a client in the entertainment business because we sometimes need to direct agencies in how to be effective in manipulating the media outside of purely money-driven opportunities.

That said, there have been loads of examples of where we work well with our media agency network, Carat (we do our creative in-house). The Buena Vista Home Entertainment campaign for the Finding Nemo video and DVD, running across Europe at the moment, is a really nice example of our agency helping us to build on creative and media equity that will leverage Nemo through its lifecycle on TV, in parks and stores.

The networks are finally beginning to recognise the need to take a more proactive role in understanding consumers. It's simply a matter of natural evolution. Audience fragmentation has forced media agencies to look at the world in a very different way. Gradually, they're getting there.

COCA-COLA - Nandini Gulati, manager, integrated marketing communications, Coca-Cola Europe, Eurasia and Middle East

Agency networks, media in particular, are beginning to look uncannily similar. And the irony is that, while they are becoming tougher to tell apart, there is still a big difference in the quality of skills, people, expertise and service from one country to another in each network.

This isn't just a problem, it is a great opportunity for the networks' new European management teams to improve their offerings. But it is no mean feat. Remember, they are being asked to innovate while sailing a big ship in a sea of conservative thinkers - on both the client and agency side.

So where to start? First, they need to identify the strong-performing teams and ensure best practices are shared. This encourages the stragglers to learn from those leading the way, and will help give clients the consistency of performance across markets we need.

Second, they need to make it really clear in which direction the agency is heading. We want to know how it is different, special or better than all the others in the marketplace. And we want to see these qualities come through in the agency's work.

We also want them to show us their ability to motivate, retain and develop their people, identifying and training the potential leaders.

All these changes are achievable. There are some excellent examples of where campaigns have resulted from the work of strong advertising and media networks. We just want to see more of them.

HENKEL - Steve Harrison, international media director, Henkel

It is presumptuous of me to give any advice to the new agency heads. So here it is. I would like them to understand our business - in my case, consumer goods such as Schwarzkopf hair products - and to understand their own. We have centralised our decision-taking to improve efficiency and cut costs. Agency networks are a commodity industry that have failed to do the same.

Agencies need strong, central management that has the strength of character and authority to impose network decisions. The best example that I have met was Bernard Brochand at DDB before he left for a career in politics.

I have heard the idea of networks returning to the full-service model.

There has never been any evidence or analysis to support this view. Indeed, I have only heard the idea proposed by stupid and ignorant people.

The full-service agency only existed because of the 15 per cent commission rate. Why should an advertiser pay for a media service when he got it "free" within the 15 per cent? As soon as the 15 per cent commission disappeared, it became logical for advertisers to make a separate appointment to obtain a better media service.

This idea has only gained currency because of the backward-looking nature of the ad industry. Agencies would love to return to the lucrative (and full-service) days of the 60s. Media salespeople would love to return to the high margins of the same period.

I think there may be a broader issue here. Advertising people keep on claiming that their industry is undergoing substantial and dramatic change. They have been doing so, to my knowledge, for the past 30 years. During this period, in comparison with other industries, there has been virtually no change whatsoever. By and large, we still have the same media, used in the same ways, that we had 30 years ago.

My belief is that things will have to change. Media agency networks are not offering advertisers what they want. We want greater efficiency and lower costs. They offer ancillary services and higher fees.

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